It has already been a wild year for the PowerShares NASDAQ Internet Portfolio (NasdaqGS: PNQI) – in a good way. Not only is the previously unheralded PNQI on the list of the 10 best-performing non-leveraged ETFs, the fund has pulled in almost $99 million of its $185 million in assets under management since the start of the year.
PNQI, which has surged 51.4% year-to-date, has been bolstered by resurgent Facebook (NasdaqGM: FB) and the strong balance sheets of Internet giants such as Amazon (NasdaqGM: AMZN) and Google (NasdaqGM: GOOG). Additionally, Internet ETFs have provided investors with shelter from the storm of rising Treasury yields as most brand-name Internet stocks have soared in the face of rising rates. [Internet ETFs: Rising Rates Shelter]
Then there has been the ebullience surrounding the upcoming initial public offerings for Alibaba and Twitter, which have given the Internet space a late 1990s feel. [Internet ETFs: Dot-Com Bubble Back?]
However, earnings reports are likely to chart the near-term course for PNQI and worth noting is that the ETF is home to some stocks that really move following their profit updates. In fact, no stock in the S&P 1500 moves more in the day following its earnings report than Netflix (NasdaqGM: NFLX). Its average one-day, post-earnings move is almost 14.5%, according to Bespoke Investment Group.
PNQI’s potential for big earnings season moves does not end with Netflix. Priceline.com (NasdaqGM: PCLN) is sixth on the list of S&P 1500 post-earnings movers with an average move of 12.9%. Priceline and Netflix are both top-10 holdings in PNQI, combining for 12.1% of the ETF’s weight. Other marquee Internet names held by PNQI eBay (NasdaqGM: EBAY) and Baidu (NasdaqGM: BIDU).
PowerShares NASDAQ Internet Portfolio
ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of Amazon, Facebook and Google.